Day: May 31, 2008

Letter Re: Physical Gold Versus Electronic Gold

Dear Mr. Rawles: You are clearly (and presciently) on the record as recommending the purchase of precious metals, ahead of the current inflationary cycle. Congratulations on that excellent macro call. But I believe you also recommend holding the physical commodity rather than synthetic ownership through an exchange traded fund/note. This makes less sense to me. As an economic hedge against fiat currency deflation, synthetic gold has lower transaction costs since you don’t have to pay for the transport of the gold, the retail broker markup, or the non-gold coinage aspects of value that are embedded into Krugerrand, Maple Leaf, and …


Letter Re: Can I Burn Home Heating Oil or Kerosene in a Diesel Engine?

James: Your article today about diesel vehicles still providing long term cost savings was quite interesting. The question I have, and perhaps [shared by] some of your readers is this: is home heating oil and kerosene acceptable fuel for a diesel engine? – Thanks, – Jim G. JWR Replies: Home heating oil burns fine in any diesel engine, but in may countries it is not legal to do so in a vehicle that is driven on public roads. This is a “road tax” issue. Aside for a red dye additive, the formulation of home heating oil is almost identical to …


Odds ‘n Sods:

From reader RBS: Buffett sees “long, deep” U.S. recession    o o o Mike W. sent us a link to a piece written by one of my heroes, Dr. Walter E. Williams: False prophets of doom–Environmentalists would prefer that we forget these predictions    o o o I was doing some web surfing, and a stumbled into a great collection of photos of Swiss bunkers.    o o o While the Novovirus threat is subsiding with warmer weather, Rourke sent us an article about a new threat, a bacteria called C-diff: Gut superbug causing more illnesses, deaths


Jim’s Quote of the Day:

“Unfortunately, solving our economic problems is not a simple matter of passing a law to reestablish gold or any other commodity as money. It was not the politicians, but rather the electorate that demanded the abandonment of the gold standard and the establishment of a credit-money standard. In a nation run by majority rule, unless you can convince individuals to abandon the use of government as a sword of theft, gold or any other commodity will never last as the basis for money. A gold standard is not the cause of a stable economy, it is the result of a …